GSK Receive £297 Million Fine For China Bribes

GSK has been fined almost £300 million by a court in China, which is a record in the country for bribing health officials to use its products.

The pharmaceutical giant has confirmed that £297 million penalty has been imposed by the Changsha Intermediate People’s Court in Hunan Province. They have also accepted that illegal activities have taken place and the fine would be paid through existing cash resources.

Sky News have reported that the former head of GSK in China Mark Reilly and other executives would be deported and have be handed three year suspended sentences, with them all being spared jail terms.

The company’s statement said the court found that “GSK China Investment (GSKCI) offered money or property to non-government personnel in order to obtain improper commercial gains.

GlaxoSmithKline have since issued a statement of apology to the Chinese government and it’s people, which has been released on the GSK website. The statement read the following; 

GSK has co-operated fully with the authorities and has taken steps to comprehensively rectify the issues identified at the operations of GSKCI.

This includes fundamentally changing the incentive programme for its salesforces (decoupling sales targets from compensation); significantly reducing and changing engagement activities with healthcare professionals; and expanding processes for review and monitoring of invoicing and payments.

The investigation had taken a number of twists with a British man and his Chinese partner who hired as investigators by GSK, being jailed for two and a half years back in August. The Chinese authorities charged Peter Humphrey with illegally obtaining Chinese citizens person information and selling it to companies which included GSK on the list.

GSK had hired Mr Humphrey after an anonymous email, which contained a sex tape of Mr Reilly and his Girlfriend was sent to senior management of the company in January 2013. The email also spoke of alleged corrupt practices in GSK’s China operation.

In a strange turn events after the ruling in China the GSK share price has risen by almost 0.6%, which is good news after the share price recently has been taking a battering and falling significantly.

Alex Carson

PiR Resourcing leaders in senior life science resourcing. For more news and information, you can follow us on Twitter and LinkedIn  For all our latest roles in the Life Science sector please click here.

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